Rafizi wants Edra sabotaged again

Rafizi declares war on China investments in Malaysia

(FMT) – PKR vice-president Rafizi Ramli today called on Malaysian institutional investors responsible for public funds to boycott the initial public offering (IPO) by Edra Power Holdings Sdn Bhd, a former subsidiary of 1MDB.

In a statement, he named some of these institutional investors as the Employees Provident Fund (EPF), Tabung Haji, Retirement Fund Incorporated (KWAP), Social Security Organisation (Socso), Permodalan Nasional Bhd (PNB), Khazanah and Mara.

He said these investors should stay away from the IPO to avoid having public funds ensnared for a second time in the 1MDB scandal.

Edra, the former holding company of 1MDB’s energy assets, was sold to China General Nuclear Power Corporation (CGNPC), an independent power producer, for RM9.83 billion in 2015 as part of a “rationalisation effort” to reduce the debts of the sovereign investment fund.

Edra’s IPO was reported by Bernama on July 2.

“Faced with the burden of debts, the (Prime Minister Najib Razak’s) administration (through 1MDB) sold our country’s energy assets to a China-based company, a deal that violated standing rules on ownership of electricity producers but was approved via a special waiver.

“The consequence is that a China-owned company has become the second largest independent power producer in Malaysia,” he said.

Rafizi said that, during the sale of the energy assets, the Najib administration explained that the Chinese company’s offer was higher than that quoted by the next nearest bidder, Tenaga Nasional Bhd, of RM8.6 billion.

Based on this principle, 1MDB “gambled with our national strategic assets” on the excuse of reducing 1MDB’s debts, he said.

He said the impending listing of Edra on Bursa Malaysia to raise up to RM5 billion must be given serious attention.

“Firstly, the debts which must be repaid by 1MDB (which led to the sale of its energy assets) resulted from the purchase of those assets at a higher price from the original owners which were companies with close ties to Barisan Nasional.

“Secondly, the funds raised by going into debt, supposedly to finance 1MDB’s business, were misappropriated for purposes of buying personal and extravagant properties. This caused 1MDB to be unable to generate any returns until its debts had to be borne by the public.

“Thus, if Edra’s share offerings are taken up by investment funds or funds owned by Malaysians, this will be similar to Malaysians bearing 1MDB’s debts twice,” said Rafizi.

He said this was because the first round of debts taken up by 1MDB had been misappropriated.

By taking up the shares in the Edra IPO, Malaysians would be giving money to Edra’s new owners to repay the RM5 billion paid by CGNPC to 1MDB.

Rafizi urged Najib to ensure that the money paid to 1MDB for the energy assets by CGNPC came from the Chinese company and not from Malaysians through buying Edra’s shares in the IPO.